Webinar Recap: Balancing Risk & Reward with PayFac as a Service 

TL;DR

Our recent webinar, Balancing Risk & Reward with PayFac as a Service, provided invaluable insights into how software providers can maximize every aspect of software embedded payments revenue. Hosted by Nick Campbell, Chief Product Officer at Xplor Pay, the session explored how businesses can leverage a PFaaS provider to strike their desired level of embedded payments control while maximizing revenue and mitigating risk. 

The webinar highlighted four core pillars software providers should focus on—maximizing attach rates, increasing wallet share, minimizing cost to serve, and optimizing portfolio performance. This recap summarizes the actionable strategies  designed to help software providers navigate the complex world of payments while driving sustainable growth. 

What Does it Mean to Balance Risk & Reward with PayFac as a Service? 

Before diving into the core pillars, Nick started off by demystifying what it means to balance risk and reward with PayFac as a Service. 

So, what does it mean?

Finding your balance means assessing your risk tolerance, resources, challenges and overall payments revenue goals. 

Why is this important?

Through years of experience executing embedded payments strategies for software partners and 15 owned business management systems (BMS), we’ve learned that there is no one size fits all approach. However, many providers take this approach, leaving software vendors with a list of challenges that prevent them from tapping into their full revenue potential. 

Do any of these challenges sound familiar? 

4 Core Pillars of Embedded Payments Revenue  

Working through the challenges above with a partner that supports the balance of risk and reward you want to achieve helps generate sustainable revenue growth from your payments program. This means more revenue from higher attach rates, healthy margins and a reliable service model. 

1. Maximize Payment Attach Rates 

In the webinar, Nick emphasized how maximizing attach rates ensures that your embedded payments solution works for you, unlocking revenue potential with every transaction. Attach rates, sometimes referred to as payment adoption rates, are a critical driver of revenue growth for software platforms.  

Just consider, you spend all this time and money standing up a payment integration but are struggling to drive merchants to adopt the new payments integration within your software platform.  

Nick then shared compelling examples of how we helped two of our owned BMS platforms, Xplor Spot and FieldEdge, who increased payment attach rates to 80% and 95%, respectively.  

2. Maximize Share of Wallet 

Maximizing wallet share means capturing a larger portion of your customers’ payment processing needs, driving more transactions through your platform. During the webinar, Nick emphasized that a tailored approach to payment workflows is essential to achieving this. By analyzing the full spectrum of payments, from card-not-present (CNP) to card-present (CP) transactions, businesses can integrate payment solutions that maximize wallet share across all customer touchpoints. 

An example from the dental industry highlighted this strategy in action. Xplor Pay partnered with a patient engagement system that was already seeing over 90% attach rates, yet only capturing a small fraction (5%) of the total payment volume processed by dental offices. Patients typically paid in person, which meant that payments were processed through separate practice management systems, bypassing their engagement system. 

We made a simple adjustment that dramatically increased payment volumes, from $1,500 to $33,000 per month, while also lowering transaction costs through card-present interchange rates. 

3. Minimize Cost to Serve 

Minimizing the cost to serve is crucial for maintaining profitability while delivering high-quality payment solutions. During the webinar, Nick discussed how Xplor Pay’s API-first technology, combined with a deep partnership approach, and dedicated partner support, enables SaaS platforms to embed payments in a way that is both cost-effective and scalable. By aligning payment solutions with a business’s growth trajectory, Xplor Pay ensures that platforms can grow efficiently without incurring excessive costs. 

One example is a long-term automotive partner that started with a simple semi-integrated hardware solution. As their platform grew, they added advanced features like text-to-pay, email payments, and electronic check acceptance, reducing operational costs while meeting customer demands. 

4. Optimize Portfolio Performance 

Optimizing portfolio performance is about continuously monitoring your portfolio to ensure your software platforms not only drive revenue but also operate efficiently, with a focus on maximizing profitability. During the webinar, Nick highlighted the importance of leveraging reporting tools to gain deeper insights into payment performance and identify areas for improvement. 

Xplor Pay’s reporting API allows SaaS partners to retain customers within their platform while accessing detailed transaction data. For example, a healthcare partner used the interchange report to find downgrades in transactions caused by missing Level 2 data for HSA cards. 

After working with our Integration Support team to add the required fields, the partner saved $84K annually, improving both payment efficiency and overall portfolio performance. 

Wrapping Up. 

Overall, the Balancing Risk & Reward with PayFac as a Service webinar provided software providers with actionable strategies to enhance their embedded payments approach. From maximizing attach rates and wallet share to minimizing the cost to serve and optimizing portfolio performance, the insights shared by Nick highlighted the immense potential of PFaaS to drive sustainable growth and profitability. 

At Xplor Pay, our solutions don’t put you in a box; we meet you where you are today and offer consultative guidance to help you scale your revenue goals.

Want to start maximizing your embedded payments revenue as soon as possible? 

Schedule time with one of our payments consultants. 

Frequently Asked Questions

What does it mean to balance risk and reward with PayFac as a Service?

Balancing risk and reward with PayFac as a Service means choosing a payments model that matches your platform’s revenue goals, risk tolerance, operational resources, and desired level of control. Instead of taking on the full complexity of becoming a payment facilitator, software providers can use PayFac as a Service to access more embedded payments value while relying on an experienced partner for infrastructure, compliance, and risk support.

How can PayFac as a Service help software providers grow embedded payments revenue?

PayFac as a Service can help software providers grow embedded payments revenue by improving payment adoption, increasing transaction volume through the platform, reducing operational costs, and providing better portfolio insights. These improvements can help payments become a more sustainable revenue stream instead of a disconnected feature.

What are payment attach rates?

Payment attach rates measure how many eligible customers or merchants adopt and use a platform’s embedded payment solution. Higher attach rates can help software providers capture more payment volume, increase revenue, and make the payment experience a more valuable part of the software platform.

How can software providers increase share of wallet with embedded payments?

Software providers can increase share of wallet by supporting more of their customers’ payment needs across different workflows, channels, and transaction types. This may include card-present, card-not-present, text-to-pay, email payments, ACH, recurring billing, or other payment options that keep more transaction volume inside the platform.

Why is cost to serve important in embedded payments?

Cost to serve is important because payments can become expensive to manage if support, operations, integration maintenance, and merchant needs are not handled efficiently. Reducing cost to serve helps software providers protect margins while still delivering reliable payment experiences and support as the platform scales.

What does portfolio performance mean in embedded payments?

Portfolio performance refers to how well a software provider’s merchant base is performing across payment volume, profitability, transaction costs, risk, retention, and operational efficiency. Strong reporting and portfolio visibility can help providers identify issues, improve margins, reduce downgrades, and make more informed payments strategy decisions.

What should software providers look for in a payment facilitator as a Service partner?

Software providers should look for a PayFac as a Service partner that offers flexible payment models, consultative guidance, API-first technology, dedicated partner support, reporting tools, risk and compliance support, and a clear strategy for increasing payment adoption and revenue. The right partner should help the platform scale payments without forcing a one-size-fits-all approach.